AWON A 1 Group Inc (PK)

FREEBUTTON, INC.

STATEMENTS OF CASH FLOWS

(Unaudited)

The accompanying notes are an integral part of these financial statements.

NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION

The Company was incorporated on November 27, 2006 under the laws of the State of Nevada and extra-provincially registered under the laws of the Province of Ontario on February 2, 2007. On September 28, 2012, the Company with a majority of the shareholders and directors changed its name from Secured Window Blinds, Inc. to Freebutton, Inc.

Freebutton, Inc. has ceased the business of offering window blind system products and now intends to operate, through “TheFreeButton.com”, as an instant-win promotion online site where users can click the “Free Button” to instantly win the products offered on the Company’s homepage without entering their email.

Going concern

To date the Company has generated minimal revenues from its business operations and has incurred operating losses since inception of $595,401. As at June 30, 2014, the Company has a working capital deficit of $354,313. The Company requires additional funding to meet its ongoing obligations and to fund anticipated operating losses. The ability of the Company to continue as a going concern is dependent on raising capital to fund its initial business plan and ultimately to attain profitable operations. Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern. The Company intends to continue to fund its business by way of private placements and advances from related parties as may be required. As of June 30, 2014 the Company has issued 150,000,000 shares founders shares at $0.0000667 per share for net proceeds of $10,000 to the Company and 9,300,000 shares private placement shares at $0.001666 per share for net proceeds of $15,500 and 100,000 shares private placement shares at $0.025 per share for net proceeds of $25,000 to the Company and 500,000 shares private placement shares at $0.25 per share for net proceeds of $125,000 to the Company and 200,000 shares private placement shares at $0.50 per share for net proceeds to the Company of $50,000. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Unaudited Financial Statements

The accompanying unaudited financial statements have been prepared in accordance with U.S. generally accepted accounting principles for financial information and with the instructions to Form 10-Q. They do not include all information and footnotes required by United States generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the year ended December 31, 2013 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission. The unaudited financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the six months ended June 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014.

Segmented Reporting

Financial Accounting Standards Board (“FSAB”) Accounting Standard Codification (“ASC”) 280, “Disclosure about Segments of an Enterprise and Related Information”, changed the way public companies report information about segments of their business in their quarterly reports issued to shareholders. It also requires entity-wide disclosures about the products and services the entity provides, the material countries in which it holds assets and reports revenues and its major customers.

Comprehensive Loss

FASB Statement Number 130, “Reporting Comprehensive Income,” establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at June 30, 2014, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.

Use of Estimates and Assumptions

Preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Accordingly, actual results could differ from those estimates.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Financial Instruments

All significant financial assets, financial liabilities and equity instruments of the Company are either recognized or disclosed in the financial statements together with other information relevant for making a reasonable assessment of future cash flows, interest rate risk and credit risk. Where practical the fair values of financial assets and financial liabilities have been determined and disclosed; otherwise only available information pertinent to fair value has been disclosed.

Fixed Assets

Fixed assets are carried at cost less accumulated depreciation.  Depreciation is provided over their estimated useful lives, using the straight-line method. Estimated useful lives of the plant and equipment are as follows:

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the statement of income. Accumulated depreciation to date on office equipment is $1,428.

Website Development Costs/Domain Names

The Company accounts for its Development Costs in accordance with FASB ASC-350-50, “Accounting for Website Development Costs.” The Company’s website comprises multiple features and offerings that are currently developed with on-going refinements. In connection with the development of its products, the Company has incurred external costs for hardware, software, and consulting services, and internal costs for payroll and related expenses of its technology directly involved in the development. All hardware costs are capitalized as fixed assets. Purchased software will be capitalized in accordance with FASB ASC codification 350-50-25 related to accounting for the costs of computer software developed or obtained for internal use. All other costs are reviewed to determine whether they should be capitalized or expensed.

Pursuant to FASB ASC 360, the Company periodically evaluates, at least annually, whether facts or circumstances indicate that the carrying value of its depreciable assets to be held and used may not be recoverable. Domain names are generally not amortized. If such circumstances are determined to exist, an estimate of undiscounted future cash flows produced by the long-lived asset, or the appropriate grouping of assets, is compared to the carrying value to determine whether impairment exists. In the event that the carrying amount of long-lived assets exceeds the undiscounted future cash flows, then the carrying amount of such assets is adjusted to their fair value. The Company reports an impairment cost as a charge to operations at the time it is recognized .

Impairment of Long-Lived Assets

Long-lived assets, such as property and domain names and website development costs are reviewed for impairment when recoverability of assets to be held and used is measured by comparison of the carrying amount of an asset to estimated undiscounted future cash flows expecting an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset.

Revenue Recognition

Revenue consists of commissions earned for the sale of magazine advertisement, on-line advertisement and event sponsorship. Revenue is recognized at the time the advertising becomes publicly available or upon occurrence of the sponsored event.

Loss per Common Share

Basic earnings (loss) per share includes no dilution and is computed by dividing income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period. Dilutive earnings (loss) per share reflect the potential dilution of securities that could share in the earnings of the Company. Because the Company does not have any potential dilutive securities, the accompanying presentation is only on the basic loss per share.

Income Taxes

The Company follows the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances and tax loss carry-forwards. Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Stock-based Compensation

The Company follows FASB ASC 718-10, "Stock Compensation", which addresses the accounting for transactions in which an entity exchanges its equity instruments for goods or services, with a primary focus on transactions in which an entity obtains employee services in share-based payment transactions. ASC 718-10 is a revision to SFAS No. 123, "Accounting for Stock-Based Compensation," and supersedes Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued to Employees," and its related implementation guidance. ASC 718-10 requires measurement of the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). Incremental compensation costs arising from subsequent modifications of awards after the grant date must be recognized. On February 25, 2013, the Board of Directors of the Company adopted a new equity incentive award plan, named the FreeButton, Inc. 2013 Equity Incentive Award Plan (the “2013 Plan”), which has been approved by a majority, or approximately 65% of outstanding shareholders of the Company on February 25, 2013.The new plan is an “omnibus plan” under which stock options, stock appreciation rights, performance share awards, restricted stock and restricted stock units can be awarded. The 2013 Plan’s initial share reservation will be 3,500,000 shares. The term of the plan is for 10 years from the date of its adoption. As of June 30, 2014 the Company has issued 39,640 common shares.

Recent Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

NOTE 3 – STOCKHOLDERS’ EQUITY/DEFICIT

The Stockholders’ Equity/Deficit section of the Company contains the following classes of Capital Stock as of June 30, 2014.

On December 15, 2006, the Company issued 105,000,000 common shares at $0.0000666 per share to the sole director and President of the Company for cash proceeds of $7,000.

On May 12, 2008, the Company issued 45,000,000 common shares at $0.0000666 per share to the sole director and President of the Company for cash proceeds of $3,000.

From September to August, 2008, the Company issued 9,300,000 shares through private placements at $0.001666 per share for net proceeds to the Company of $15,500.

On June 26, 2012, the President of the Company forgave all debts owing to him by the Company for all advances/shareholders loans totalling $54,742. All these sums are reflected as a credit to additional-paid-in-capital.

On August 15, 2012, two shareholders of the Company returned 126,000,000 (pre-split 8,400,000) restricted shares of common stock to treasury and the shares were cancelled by the Company. The shares were returned to treasury for no consideration to the shareholder. Following the cancellation the Company now has 33,300,000 (pre-split 2,220,000 shares of common stock outstanding.

On August 22, 2012 a majority of shareholders and the directors approved a special resolution to undertake a forward split of the common stock of the Company on a 15 new shares for 1 old share, which was effected on October 1, 2012, increasing the outstanding shares from 2,220,000 to 33,300,000.

NOTE 3 – STOCKHOLDERS’ EQUITY/DEFICIT (continued)

On February 25, 2013, the Company issued 100,000 common shares through a private placement at $0.25 per share for net proceeds to the Company of $25,000.

On February 25, 2013 the Company issued under the 2013 Plan a total of 7,000 common shares to one individual and two companies. Total value received for services rendered was $4,430 (refer Equity Incentive Award Plan).

On July 11, 2013, the Company issued 100,000 common shares through a private placement at $0.25 per share for net proceeds to the Company of $25,000.

On September 16, 2013, the Company issued 300,000 common shares through a private placement at $0.25 per share for net proceeds to the Company of $75,000.

Private Placement Memorandum

On October 23, 2013 FreeButton, Inc., offered under a Private Placement Memorandum to raise a minimum of $550,000 to a maximum of $2,000,000 at $0.35 per share. The offering extends from October 23, 2013 to close of business on December 31, 2013 unless the Offering is extended at the Company’s sole discretion. Subsequently the Offering was extended to February 28, 2014. There is no escrow of any of the proceeds of the Offering, however the Company will not make use of the funds until a minimum of $550,000 prior to commissions or net $500,000 to the Company has been received. If minimum is not met the Company will return funds to the investor.

On November 14, 2013, the Company issued 100,000 common shares through a private placement at $0.35 per share for net proceeds to the Company of $35,000.

On November 20, 2013, the Company received $36,750 in Subscription receivables to issue 105,000 common shares through a private placement at $0.35 per share.

On March 4, 2014, the Company not having met the minimum $500,000 net proceeds under the terms of the Private Placement Memorandum the Company returned the total funds of $71,750 to the investors. The 100,000 shares that had been issued were returned to the Company. The reversal of the transaction is reflected in the financial statements dated December 31, 2013.

On May 27, 2014, the Company received $50,000 in Subscription receivables to issue 100,000 common shares through a private placement at $0.50 per share.

All references in these financial statements to number of common shares, price per share and weighted average number of common shares outstanding prior to the 15:1 forward split have been adjusted to reflect the stock split on a retroactive basis, unless otherwise noted.

Equity Incentive Award Plan

On February 25, 2013, the Board of Directors of the Company adopted a new equity incentive award plan, named the FreeButton, Inc. 2013 Equity Incentive Award Plan (the “2013 Plan”), which has been approved by a majority, or approximately 65% of outstanding shareholders of the Company on February 25, 2013.

The new plan is an “omnibus plan” under which stock options, stock appreciation rights, performance share awards, restricted stock and restricted stock units can be awarded. The 2013 Plan’s initial share reservation will be 3,500,000 shares. The term of the plan is for 10 years from the date of its adoption.

On February 25, 2013 the Company issued under the 2013 Plan a total of 7,000 common shares to one individual and two companies. Total value received for services rendered was $4,430.

On June 25, 2013 the Company issued under the 2013 Plan a total of 32,640 common shares to two individuals. Total value received for services rendered was $2,285.

NOTE 4 – RELATED PARTY TRANSACTIONS

On December 15, 2006 the Company issued 105,000,000 shares of common stock at $0.0000666 per share to its sole director and President of the Company for cash proceeds of $7,000. On May 12, 2008 the Company issued 45,000,000 shares of common stock at $0.0000666 per share to its sole director and President of the Company for cash proceeds of $3,000. During the nine months ending September 30, 2012 the President of the Company paid outstanding payables owed by the Company of $28,400. On June 26, 2012, the President of the Company forgave all debts owing to him by the Company for all advances/shareholders loans totalling $54,742. All these sums are reflected as a credit to additional-paid-in-capital.

On August 15, 2012, two shareholder of the Company returned 126,000,000 (pre-split 8,400,000) restricted shares of common stock to treasury and the shares were cancelled by the Company. The shares were returned to treasury for no consideration to the shareholder. Following the cancellation, as of December 31, 2012 there were 33,300,000 (pre-split 2,220,000) shares of common stock outstanding.

On December 31, 2013 the Company paid shareholders loan in the amount of $4,072 owed to the President of the Company. The amounts due to the related party, was unsecured and non- interest-bearing with no set terms of repayment.

During the period ended June 30, 2014, the Company paid $2,300 in management fees.

See Note 6 for further discussion of related party transactions.

NOTE 5 – CONVERTIBLE PROMISSORY NOTE

On August 9, 2012 the Company signed a Convertible Promissory Note for $110,000, with an interest rate of 8% with a maturity date of August 9, 2013. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $1,000,000 at a differing price. Part of the consolidated and extension dated November 4, 2013.

On November 20, 2012 the Company signed a Convertible Promissory Note for $25,000, with an interest rate of 8% with a maturity date of May 20, 2013. Maturity date has been extended to November 20, 2013. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $225,000 at a differing price. Part of the consolidated and extension dated November 4, 2013.

On December 13, 2012 the Company signed a Convertible Promissory Note for $10,000, with an interest rate of 8% with a maturity date of June 13, 2013. Maturity date has been extended to December 12, 2013. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $90,000 at a differing price. Part of the consolidated and extension dated November 4, 2013.

On January 7, 2013 the Company signed a Convertible Promissory Note for $13,500, with an interest rate of 8% with a maturity date of October 3, 2013. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $121,500 at a differing price. Part of the consolidated and extension dated November 4, 2013.

On March 18, 2013 the Company signed a Convertible Promissory Note for $25,000, with an interest rate of 8% with a maturity date of September 18, 2013. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $225,000 at a differing price. Part of the consolidated and extension dated November 4, 2013.

NOTE 5 – CONVERTIBLE PROMISSORY NOTE (continued)

On April 3, 2013 the Company signed a Convertible Promissory Note for $13,500, with an interest rate of 8% with a maturity date of October 2, 2013. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $121,500 at a differing price. Part of the consolidated and extension dated Nov 4, 2013.

On April 25, 2013 the Company signed a Convertible Promissory Note for $25,000, with an interest rate of 8% with a maturity date of October 25, 2013. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $225,000 at a differing price. Part of the consolidated and extension dated Nov 4, 2013.

On May 24, 2013 the Company signed a Convertible Promissory Note for $30,000, with an interest rate of 8% with a maturity date of November 24, 2013. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $270,000 at a differing price. Part of the consolidated and extension dated Nov 4, 2013.

On August 8, 2013 the Company signed a Convertible Promissory Note for $13,996.50, with an interest rate of 8% with a maturity date of February 14, 2014. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $125,964 at a differing price. Part of the consolidated and extension dated November 4, 2013.

On October 23, 2013 the Company signed a Convertible Promissory Note for $10,000, with an interest rate of 8% with a maturity date of October 23, 2014. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $90,000 at a differing price.

On November 4, 2013 the Company signed a consolidated and extension of all the Company’s existing Promissory Notes and accrued interest as of October 31, 2013. The New total amount of the combined Promissory Note is $285,240.26 ($265,996.50 principal and $19,243.76 accrued interest) with an interest rate of 8% and maturity date of February 9, 2014. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $1,000,000 at a differing price. In the event the Company does not pay the outstanding balance by February 9, 2014, the interest rate of the Promissory Note increases to 12% per annum.

On December 23, 2013 the Company signed a Convertible Promissory Note for $20,000, with an interest rate of 8% with a maturity date of December 23, 2014. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $180,000 at a differing price.

On March 11, 2014 the Company signed a consolidated and extension of the Company’s Promissory Notes. The New total amount of the combined Promissory Note is $307,266.26 (Promissory Note of $285,240.26 dated November 4, 2013 and Promissory Note of $22,026 dated February 28, 2014) with an interest rate of 8% and maturity date of August 28, 2014. . The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $1,000,000 at a differing price. In the event the Company does not pay the outstanding balance by August 28, 2014, the interest rate of the Promissory Note increases to 12% per annum.

NOTE 5 – CONVERTIBLE PROMISSORY NOTE (continued)

On June 20, 2014 the Company signed a Convertible Promissory Note for $16,828.56, with an interest rate of 8% with a maturity date of December 20, 2014. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $152,000 at a differing price.

The conversion of the Promissory Note(s) is contingent upon an “Event Default” and the Promissory Note is not currently convertible. If the Promissory Note does become convertible the non-cash expense to the Company is dependent on the trading value of the Company’s stock on the day of conversion and the $0.10 conversion price. The estimated non-cash expense if the Promissory note had been converted as of June 30, 2014 would have been $1,782,144.

NOTE 6 – ASSET AND BUSINESS ACQUISITION

Media Rhythm Group, Inc.

On July 11, 2013, the Company entered into an Assets and Business Acquisition Agreement (the “Acquisition Agreement”) with Media Rhythm Group, Inc. (“Media Rhythm”) to acquire all of the assets in connection to the business of Media Rhythm (the “Assets”). Media Rhythm operates a marketing and advertising business that primarily caters to sports media such as magazines and websites. James Lynch, President, Chief Executive Officer, Secretary, and Director of the Company, is President and the sole shareholder of Media Rhythm (James Lynch is also President and Chief Executive Officer of FreeButton, Inc.)

Pursuant to the Acquisition Agreement, the Company purchased the Assets for $420,000 (the “Purchase Price”), and in return, issued a promissory note dated July 11, 2013 to Media Rhythm with the principal amount equal to the Purchase Price (the “Note”). Under the Note, the Purchase Price shall be paid by the Company to Media Rhythm in twenty-four (24) equal monthly installments commencing on August 1, 2013 (On August 2, 2013 the commencement date was changed to September 1, 2013), (the present value of $420,000 Note is $371,895). The Note shall bear no interest. The Company may at any time prepay all or part of the unpaid principal of the Note. The Company’s payment obligation may become accelerated upon certain events of default, including failure to make past due payment within ten (10) days of a written notice from the holder, failure to cure any involuntary insolvency or bankruptcy proceeding within ninety (90) days of the commencement of such proceeding, and filing of any voluntary bankruptcy or insolvency proceeding. Media Rhythm is entitled to the right of setoff against all or part of the unpaid and past due payments under the Note or the Acquisition Agreement.

On March 5, 2014, under the consent of both parties the Asset and Business Acquisition Agreement signed on July 11, 2013 was reversed. The reversal of the transaction is reflected in the financial statements dated December 31, 2013.

A1 Vapors, Inc.

On April 11, 2014 FreeButton, Inc., announced that it has entered into a non-binding Letter of Intent (“LOI”) to acquire A1 Vapors, Inc.(“A1 Vapors”) a product development and marketing firm catering to the electronic vapour cigarette industry. Under the terms of the LOI FreeButton will purchase all of the assets of A1 Vapors. Consideration for the purchase will be approximately 21 million restricted shares of Freebutton common stock. On May 23, 2014 FreeButton entered into an exchange agreement (the “Exchange Agreement”) with A1 Vapors. Under the terms of the Exchange Agreement, the shareholders of A1 Vapors will receive 21,000,000 newly-issued shares of FreeButton’s Common Stock in exchange for all of A1 Vapor’s outstanding Common Stock. Upon completion of the proposed transaction, A1 will become a wholly-owned subsidiary of FreeButton. The closing date is expected to be on or before September 30, 2014. The proposed acquisition will be treated as a recapitalization of the Company with Al Vapors as the accounting acquirer in accordance with the Reverse Merger rules. As a result of the proposed consummation of the Share Exchange Agreement A1 Vapors will become a wholly-owned subsidiary of the Company and the electronic vapour cigarette industry will become the primary business of the company.

NOTE 7 – DISCONTINUED OPERATIONS

On March 5, 2014, under the consent of both FreeButton, Inc. and Media Rhythm Group Inc., the Asset and Business Acquisition Agreement signed on July 11, 2013 was reversed. The reversal of the transaction is reflected in the financial statements dated December 31, 2013. (Refer Note 6).

As a result of the reversal of the Asset and Business Acquisition Agreement there was a net gain to Freebutton of $3,818.

NOTE 8 – DISTRIBUTION AGREEMENT

On October 22, 2013, FreeButton, Inc. (the “Company”) entered into an Exclusive Distribution Agreement (the “Distribution Agreement”) with Rivalfly National Network, LLC (“Rivalfly”), whereby the Company granted exclusive distribution rights to Rivalfly for its game platform for an initial term of five (5) years. The Company expectations are that the agreement will be concluded by end of first quarter of 2014.

Under the terms of the Distribution Agreement, Rivalfly will be issued up to 25,512,500 shares (the “Maximum Issuance”) of the Company’s Common Stock (the “Shares”), issuable in increments upon the Company achieving certain milestones as more fully set forth in the Distribution Agreement. More specifically, Rivalfly will be issued: (i) 4,000,000 Shares upon securing a sub-distribution agreement with Game Exchange of Colorado, Inc.; (ii) 4,000,000 Shares upon the Company’s completion of a successful test phase for its game platform; and (iii) 1,000,000 Shares for every 1,000 paying customers sourced by Rivalfly. The Share issuances are dependent in large part on the Company’s success in raising capital from investors to develop and commercialize its game platform. The Share issuances are not dependent or conditioned on Rivalfly’s efforts to raise capital on behalf of the Company.

Under the terms of the Distribution Agreement, upon the issuance of 4,000,000 Shares to Rivalfly, Rivalfly will be entitled to appoint one (1) representative to the Company’s Board of Directors and maintain that representative until the time Rivalfly no longer owns at least 2,000,000 Shares or upon termination of the Distribution Agreement.

Under the terms of the Distribution Agreement, in the event of a change in control transaction resulting in net proceeds to the Company of at least $50,000,000, the Maximum Issuance will be deemed fully-earned and issuable.

On April 25, 2014 with the consent of both parties the Distribution Agreement between Rivalfly and FreeButton has been terminated. There are no obligations to either party with termination of the Agreement.